The costs involved with selling and buying a house in Spain

With almost every sale we as a real estate agent get confronted with the explanation of costs involved. Recurring reactions from our clients and the often made remark ¨this is different than in my country¨. Let´s try to explain the common costs. Why do I say common costs? Because we often get confronted with extra costs because properties are not registered in the proper way. We will come back to that in a blog later.

Anyway we always advice to get a lawyer when you are buying a house. If the seller always handled changes to the property according the books he probably can suffice with a gestor to do all the paperwork. A lawyer has access to documents and information you as a private person don´t have access to. This will prevent the buyer that hidden matters will cause trouble during or after the sale. A lot of horror stories of buying a property in Spain can be traced back to not having a lawyer involved. Compared to most other countries the notary does not have the obligation to investigate the legality of the documents, which makes the role of the lawyer more important.

Buying a property in Spain is not that difficult if you do it by the rules with a good real estate agent showing you the right way.

Coming back to the costs both parties, the buyer and the seller, have to deal with costs.

Buyer costs

Purchace price

Property Transfer Tax
This tax for transferring second-hand properties in the communidad Valencia is 10% of the selling price. In case of a newly build property you don´t pay this tax but you have to pay 10% IVA (VAT) and on top of that 1.5% IAJD which is a Tax on documented legal acts.
note: if you buy a plot from a company and not from a private person the IVA (VAT) will be 21%.

Property registry costs
These are the costs to legally register the property on your name. The costs depend on the place you have to register your property and are between about €400 and €650.

Solicitor /Gestor costs
Normally  the solicitor can handle all the paperwork. You can decide to split the lawyer work and let a gestor do the paperwork. In practice the costs will not vary that much and will be around 1% of the selling price.

Mortgage costs
In case you need a lone to finance (a part) of the property a bank will charge you with costs involved. These costs may vary per bank.

Notary fees
depending of the selling price of the property the notary fees will be between €650 and €1000.

Seller Costs

Agency commission
A good real estate agent will make a contract with you for selling the house. In this contract the agency commission has to be mentioned and will be an average of 5%.

Capital gains tax
This is the tax you have to pay over the difference between the current selling price and the price payed when bought.
19% over the first €6000
21% over over the amount between €6000 and €50.000
23% above €50.000
In case you are a non resident there will be made a retention of 3% over the selling price which will be settled with the actual costs of the tax. In case it is less than the 3% you can recover the amount.
You can deduct all the costs related to the purchase of the house such as notary-  agenc-  lawyer-costs as well renovation costs.
In case you are 65 year or older and were living  official as a resident longer than 3 years you don´t have to pay the capital gains tax.

This is a local tax over the increase of the value of the land. The height of this tax depends on three factors: location of the property, period of ownership and cadastral ground value (this is not the commercial value).

Energy certificate
Such as in every European country you need to present an energy certificate of your house. An architect can make this for you and will cost between €100 and €500 depending the architect and the value of the house.

Second occupancy certificate
When a house is older than 10 years you need this certificate which can be made by an architect. In case the house is younger you should have a first occupancy certificate. The costs of this certificate are somewhere between €200 and €600. When you combine the order of making the Energy certificate and the second home occupancy certificate at one architect you can save money.

If you have any questions about the costs buying or selling a property don´t hesitate to contact us: